The city was an ancient port known to have traded with Europe in Greek and Roman times before it became a Portuguese and later a Dutch colony. Its influence declined with the growth of Chennai. Economic activity includes ship repair, fishing, steel rolling, and the manufacture of metal goods. Tourism has also become important in the region.

In December 2004 a large tsunami in the Indian Ocean generated by an undersea earthquake near Sumatra caused widespread death and destruction in Nagapattinam and nearby coastal areas. More than 6,000 people died in the disaster, and tens of thousands were left homeless, making it the hardest-hit region in India. Government recovery efforts in the following years included constructing nearly 20,000 new homes and rebuilding the region’s transportation infrastructure. Pop. (2001) 93,148; (2011) 102,905.